Customer relationship management (CRM) refers to the principles, practices and guidelines that an organization follows when interacting with its customers. From the organization’s point of view, this entire relationship encompasses direct interactions with customers, such as sales and service-related processes, and forecasting and analysis of customer trends and behaviors. Ultimately, CRM serves to enhance the customer’s overall experience. Customer Relationship Management (CRM) is a strategy for managing all your company’s relationships and interactions with your customers and potential customers. It helps you improve your profitability. CRM system is a tool which helps with contact management, sales management, workflow processes, productivity and more.
With the growth of the internet and related technologies, customers are concerned about the privacy and safety of their personal information. Therefore, businesses need to ensure the storage and analysis of their customer data have the highest levels of protection against cyber criminals, identity and other breaches of security. One important aspect of the CRM approach is the systems of CRM that compile data from a range of different communication channels, including a company’s website, telephone, email, live chat, marketing materials, and more recently, social media. Through the CRM approach and the systems used to facilitate it, businesses learn more about their target audiences and how to best cater to their needs. As CRM processes and stores sensitive data — consumers’ email addresses and birth dates, for example — developers have created features to prevent security breaches. CRM administrators can limit access to a system with access controls, for example. Salesforce, Zoho, Act!, Microsoft Dynamics and HubSpot are among the most popular CRM systems, according to business software review website Capterra. Businesses can integrate CRM software with other applications, such as enterprise resource planning tools and business analytics programs.
The Benefits of CRM–CRM automates the information-gathering process. This software accumulates customer data automatically, saving organizations time. It facilitates better communication, too. Staff in different departments — marketing, sales, customer service, project management, etc. — share CRM data and collaborate on different projects. For marketers, CRM provides in-depth customer insights. It tracks customer behavior across various channels and lets businesses measure customer preferences. Sales reps also use CRM data to personalize marketing. The latest CRM software makes it easy to segment customers based on location, age or shared interests and deliver more targeted marketing messages. This proves effective. Seventy-three percent of shoppers prefer to do business with a company that uses personal information to make their experiences more relevant. CRM also benefits customer service teams. Staff can view a customer’s account when they call into the office or send an email. Information like previous interactions and purchase histories help customer service reps solve complaints and cross-sell products and services.
CRM Software— Special CRM software aggregates customer information in one place to give businesses easy access to data, such as contact data, purchase history and any previous contact with customer service representatives. This data helps employees interact with clients, anticipate customer needs, recognize customer updates and track performance goals when it comes to sales. CRM software’s main purpose is to make interactions more efficient and productive. Automated procedures within a CRM module include sending a sales team marketing materials based on a customer’s selection of a product or service. Programs also assess a customer’s needs to reduce the time it takes to fulfill a request.
CRM Cloud Solutions–Cloud-based systems provide real-time data to sales agents at the office and in the field as long as a computer, smartphone, laptop or tablet connects to the internet. Such systems boast heightened accessibility to customer information and eliminate the sometimes-complicated installation process involved with other CRM products or software. A May 2017 Gartner report estimates that by 2019, over 85% of new packaged customer service software will be delivered on a cloud-based model — a sharp increase from about only 10% in 2008.
The convenience of this type of system, however, has a trade-off. If a company goes out of business or faces an acquisition, access to customer information may become compromised. A business might have compatibility issues when and if it migrates to a different vendor for this kind of software. Also, cloud-based CRM programs typically cost more than in-house programs.
CRM Human Management and Artificial Intelligence–All of the computer software in the world to help with CRM means nothing without proper management and decision-making from humans. Plus, the best programs organize data in a way that humans can interpret readily and use to their advantage. For successful CRM, companies must learn to discern useful information and superfluous data, and must weed out any duplicate and incomplete records that may give employees inaccurate information about customers.
Despite this human need, industry analysts are increasingly discussing the impact that artificial intelligence applications may have on CRM management and the CRM market in the near future. A Salesforce-sponsored white paper, released in 2017, estimates that AI associated with CRM activities will boost global revenue from the beginning of 2017 to the end of 2021 by $1.1 trillion. Released by International Data Corporation, the white paper states that AI could strengthen CRM activities by speeding up sales cycles, optimizing pricing and distribution logistics, lowering costs of support calls, increasing resolution rates and preventing loss through fraud detection.
Tangible AI applications for CRM, however, are in the early stages of adoption, although Salesforce, SAP and Oracle, among other large CRM providers, have reported that they’ve begun to integrate AI components into their existing CRM systems.
CRM systems include:
- Data warehouse technology, used to aggregate transaction information, to merge the information with CRM products, and to provide key performance indicators.
- Opportunity management which helps the company to manage unpredictable growth and demand and implement a good forecasting model to integrate sales history with sales projections.
- CRM systems that track and measure marketing campaigns over multiple networks, tracking customer analysis by customer clicks and sales.
- Some CRM software is available as a software as a service(SaaS), delivered via the internet and accessed via a web browser instead of being installed on a local computer. Businesses using the software do not purchase it, but typically pay a recurring subscription fee to the software vendor.
- For small businesses a CRM system may consist of a contact manager system that integrates emails, documents, jobs, faxes, and scheduling for individual accounts. CRM systems available for specific markets (legal, finance) frequently focus on event management and relationship tracking as opposed to financial return on investment(ROI).
- CRM systems for eCommerce, focused on marketing automation tasks, like: cart rescue, re-engage users with email, personalization.
- Customer-centric relationship management (CCRM) is a nascent sub-discipline that focuses on customer preferences instead of customer leverage. CCRM aims to add value by engaging customers in individual, interactive relationships.
- Systems for non-profit and membership-based organizations help track constituents, fundraising, sponsors’ demographics, membership levels, membership directories, volunteering and communication with individuals.
Key Challenges in CRM implementation
- Defining Clear Objectives
- Appointing a Core CRM Team
- Defining the Processes
- Managing the Application
- Finding a Right CRM Partner
- Analyzing customer behavior and future prediction
- Sales and marketing process integration (or automation)
- Customizing system perceived as too complicated or not easy to use
- Poor data conversion or data silos that cause data integration obstacles and challenges
- Unclear gains in customer management efficiency and/or staff productivity
- Enhancing the customer experience
Benefits in CRM implementation
- Improved Profitability
- Better Customer Relationships
- Increase customer revenues
- Maximize upselling and cross-selling
- Optimize marketing
- Better internal communication
- Improved Analytical Data and Reporting
- Greater efficiency for multiple teams